27-11-2012, 05:08 PM
Mistake
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Definition
“When the consent of the parties is caused by mistake, it is not the free consent which is needed for the validity of a contract.”
Mistake of law of the country
Ignorance of law is no excuse, is a well settled rule of law. :
A party cannot be allowed to get any relief on the ground that it had done a particular act in ignorance of law.
A mistake of law is, therefore, no excuse, and the contract cannot be avoided.
Mistake of fault
Bilateral Mistake:
Where both the parties to an agreement are under a mistake as to a matter of fact essential to the agreement, there is a bilateral mistake. In such case, the agreement is void.
Conditions:
1. The mistake must be mutual.
2. The Mistake must Relate to a matter of fact essential to agreement.
Unilateral Mistake:
“Contract is not voidable merely because it was caused by one of the parties to it being under a mistake as to a matter of fact.”
A unilateral mistake is not allowed as a defense in avoiding a contract unless the mistake is brought about the other party’s fraud or misrepresentation.